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Energy Efficiency Program
Commercial and Industrial Custom Program
This document contains recommended criteria for both gas and electric utilities. It is not intended for
distribution to customers. A custom commercial and industrial can be used by both electric and gas
utilities.
Incentive:
 Incentives will be calculated based on the annual energy savings, installed project cost and
payback. The incentive will use the lowest of the following.
o First year annual energy savings
 8¢ per kWh saved
 $0.40 per Therm saved
o 50% of the installed project cost
 The maximum incentive amount available per customer per year will be determined by the
Utility.
 Incentives for electric savings will be paid by the electric Utility and incentives for gas savings
will be paid by the gas Utility.
 To obtain a custom incentive from the Utility, a customer must obtain pre-approval from the
Utility before the customer takes any steps to purchase new equipment or systems. To qualify
for incentives under this program, the customer must receive written pre-approval from the
local utility prior to the dates of any purchase orders, invoices, bills of lading, or other purchase
or shipping documents for any equipment, materials or services relating to the project.
Equipment:
Examples of energy-efficient equipment that may qualify for incentives include:
 Boilers over 2.5 million Btu input capacity
 Ground-source heat pump systems 135 million Btuh or greater
 Premium-efficiency motors over 200 HP
 Process boiler, chiller and refrigeration improvements
 Energy management systems
 Direct-fired heating systems
 Thermal energy storage
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Program Element
Commercial and Industrial Custom Program
Objective
The objective of the Commercial and Industrial Custom Program is to encourage Utility’s commercial and
industrial (C&I) customers to install energy-efficient measures in existing and new facilities.
Target Market
All C&I customers taking service from Utility are eligible for this program. The primary target market is
existing C&I customers utilizing more complicated systems or processes in existing and new facilities.
Program
Duration
Starts when utility funds the programs and makes applications available. It will continue until funds
authorized for this program are exhausted.
Program
Description
The Commercial and Industrial (C&I) Custom Program provides custom incentives to C&I customers for the
installation of innovative and unique energy-efficient equipment and controls. Having a custom program
allows efficiency measures and systems to be installed for situations specific to that customer’s
application or process. Incentives are to be offered on a per energy (kWh and MCF) and per demand (kW)
basis based on pre-approved engineering estimates. This program targets energy savings equipment or
processes as well as applications with so much variability in operating characteristics that standardized
savings cannot be assumed across the customer base. This program also includes those technologies that
are new to the market and have not yet established baseline savings.
More specifically, the program is designed to:

Provide incentives to customers for the installation of high efficiency equipment, processes, systems
and controls based on pre-approved engineering estimates. Utility will have final approval on all
incentives.

Provide the knowledge necessary and market demand to justify the marketing of high efficiency
measures by electrical contractors, mechanical contractors, and their distributors.

Ensure that the participation process is clear, easy to understand and simple.
Where applicable, the Utility will work the other utiltiy company supplying services to the customer to
coordinate incentives, processing and assistance for those measures or systems that apply to both fuels
(ex: building shell measure improvements).
Certain barriers exist to the adoption of energy efficiency measures, including lack of investment capital,
competition for funds with other capital improvements, lack of awareness/knowledge about the benefits
and costs of energy efficiency measures, high transaction and information research costs, and technology
performance uncertainties. This program is designed to help overcome these market barriers and
encourage greater adoption of energy efficiency measures in the C&I market. The premise of the program
is that through engagement and education of the customer, identifying opportunities to save energy,
working with the market and financial incentives to reduce upfront costs, the risks to energy efficiency will
be reduced and the rewards from the savings will become more apparent thus increasing adoption.
Eligible Measures
With a custom program, flexibility is the key. Technologies that are unique to that customer, new to the
market or have a wide range of savings based on their application cannot be included in a prescriptive
program due to their variability. However these variable energy savings technologies can be significant
and encouraged through a custom incentive program. Measures must show electric energy and demand
savings or gas savings through accepted engineering analysis that will be reviewed and pre-approved by
Utility for the incentive. Measures cannot be funded through the C&I Custom Program if they are
available through the C&I Prescriptive Program unless they are in combination with other measures or
eco@home and eco@work identify energy efficiency programs and publications of
the members of the Iowa Association of Municipal Utilities.
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8/2/2017
systems that makes them unique.
Implementation
Strategy
The Utility will provide local program management, customer marketing, vendor referrals, coordination of
education and training activities and customer project solicitation and support. IAMU will provide
implementation support services, including education and training materials, tracking, verification,
technical support and development of general marketing materials. As an option in the future, IAMU may
provide application and incentive processing and incentive payments
Success of the C&I Custom Program will center on working with customers to apply energy efficiency in
unique ways to their operations and processes and working with the industry participants to find the right
solutions to their needs. The primary key to success is utilizing the existing relationships of the Utility’s
internal staff who have relationships with customers and can help identify opportunities to participate in
the program. These resources will build customer awareness, educate the customer, and work with
engineering staff, supporting engineering firms and Energy Services Companies. Through the engagement
of the market participants throughout the delivery channel, additional projects can be identified and
potential solutions suggested. These participants include manufacturers, distributors, trade associations,
consultants, engineers and contractors. The program will use Utility staff for educating, partnering and
engaging these important participants in the program as they also discuss the prescriptive program
offerings. Through these existing market participants who have relationships with C&I customers, new
high efficiency technology and custom program solutions will be offered to customers as a viable option.
To support the market participants, the program also includes customer educational and promotional
pieces designed to provide facility owners, operators and decision makers with the information necessary
to improve the energy efficiency of the systems in their facilities.
Incentives will be set using a per kWh and per MCF. Incentive levels will vary over time based on costs
and market need but will typically be established in one year increments. The Utility will use a standard
incentive rate for technologies that are established and known in the market but need financial help to
get them implemented. A higher incentive level will target technologies that are newer to the market or
have more significant risk or other barriers that need higher stimulation and awareness. The higher
incentive level may be established on a project bases by the Utility. The initial incentive levels per kWh or
MCF that are proposed and the technology categories are outlined in Appendix A. Other guidelines to
reduce free ridership will also be established. The initial guidelines are:

Simple payback for the project must be between 1 year and 8 years after the incentive is applied.

The maximum incentive will be adjusted to provide a 1 year payback.

Program incentives will not exceed 50% of the installed project cost.

Utility reserves the right to adjust these guidelines over time and to make exceptions.
Additional guidelines such as total incentives available per customer per year are established to assure
that funds are allocated across a broad cross-section of customer opportunities. This will be determined
by the Utility.
One barrier to getting measures identified and installed is getting customers to spend funds to analyze the
opportunity and savings. To help address this issue, assessment/audit grants will be available to
customers for up to 25% of the analysis cost not to exceed an amount to be determined by the Utility for
facilities less than 25,000 square feet and not to exceed an amount to be determined by the Utility for
larger facilities. If the customer implements that project, an additional bonus will be included in the
incentive to cover an additional 25% of the assessment cost using the same cost caps.
The implementation of this program will be coordinated with another utility as much as possible,
depending on the similarity of the programs.
eco@home and eco@work identify energy efficiency programs and publications of
the members of the Iowa Association of Municipal Utilities.
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Marketing
Strategy
The marketing and communications strategy will be designed to inform customers of the availability and
benefits of the program and how they can participate in the program. The strategy will include outreach
to key partners and market participants including A&E firms, Energy Services Companies, the equipment
supplier community, relevant professional and trade associations and other interested parties. An
important part of the marketing plan will be content and functionality on the Utility website, which will
direct customers to information about the program. Specific educational and promotional efforts aimed
at market participants will be developed as needed. This education will be through a combination of
mailings and direct meetings with key market participants. More specifically, the marketing and
communications plan will include:

Education to provide details about how to participate in the program.

A combination of strategies including outreach and presentations at professional and business
forums and events, and through direct outreach to key customers and customer representatives such
as:

o
Brochures that describe the benefits and features of the program including program application
forms and worksheets. The brochures will be available for various public awareness events
(presentations, seminars, etc).
o
Targeted direct mailings used to educate customers on the benefits of the program and
explaining how they can apply.
o
Customer and trade partner outreach and presentations informing interested parties about the
benefits of the program and how to participate.
o
Website content providing program information resources, contact information, downloadable
application forms and worksheets, and links to other relevant service and information resources.
o
Utility account managers informing their assigned accounts about the program during their
regular communications.
o
Presence at business events used to increase general awareness of the program and distribute
program promotional materials.
o
Presentations to key customers and customer groups to actively solicit their participation in the
program.
The marketing strategy will identify key customer segments and groups for target marketing, and will
prepare specific outreach activities for these customers.
Milestones
The program will be launched within 60 days of the Utility’s approval.
EM&V
Requirements
The evaluation of the C&I Custom Program will have an energy impact evaluation and a process
evaluation. The energy impact evaluation will focus on reliably estimating the program’s gross annual kWh
or gross annual MCF savings over the effective useful life of the energy efficient equipment installations,
with estimates of the gross peak kW savings associated with those projects. The process evaluation is
intended to provide program managers with timely recommendations on program operations,
effectiveness and participant satisfaction so that mid-course corrections may be considered.
For every incentive, proper paper documentation will be verified. Field verification of installed measures
will be made on all large projects and on a random sample of smaller projects.
eco@home and eco@work identify energy efficiency programs and publications of
the members of the Iowa Association of Municipal Utilities.
Energy Star Incentives – Page 4
8/2/2017